Nuclear site cleanup creates boom in Wash.; Elkhart wonders where the jobs are

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Workers finish expanding an opening into room 146 of a laboratory at the Department of Energy's Hanford Site in Washington state. The radioactive and toxic mess at the longtime nuclear lab has become an economic engine for Benton County, which has received nearly $2 billion in stimulus funds.

RICHLAND, Wash. — If you want to win the stimulus sweepstakes, it helps to have one of the planet's nastiest toxic waste sites in your back yard.

Doling out $787 billion in extra federal spending from the American Recovery and Reinvestment Act, the Obama administration relied heavily on “shovel ready” public works projects to get the money moving quickly through the economy.

Among the biggest projects to receive funding is a massive cleanup at the Hanford Site — a 586-square-mile nuclear facility on the arid steppes along the Columbia River where the plutonium for the bomb that devastated Nagasaki, Japan, in 1945 was created. Hanford went on to produce material for most of the 60,000 nuclear warheads in the U.S. arsenal, creating 53 million gallons of radioactive and chemical waste, 2,300 tons of spent nuclear fuel and a laundry list of other environmental hazards in the process.

The cleanup has been under way for decades, at an annual cost of around $2 billion, but the Recovery Act allowed the Energy Department, which oversees Hanford and other sites like it, to dramatically speed up the work — to the tune of an extra $1.96 billion, with a "b."

“Holy cow!”

Two thousand miles away, Jeff Taylor, transportation director for Elkhart County, Ind., can't hide his amazement at that figure. Taylor is hoping that sometime this year he'll be able to start spending stimulus money earmarked for his county's roads — about $2.5 million, with an "m."

Comparisons go only so farElkhart County is similar in some key ways to Benton County, Wash., which includes most of the Hanford Site. While Benton is nearly four times as large, its population of 170,000 is close to Elkhart's 200,000. The economies of both, each more than an hour from the nearest large urban center, are heavily dependent on single sectors — RV manufacturing in Elkhart, Hanford in Benton. Both also boast large agricultural sectors.

The cost of living in the two counties is likewise comparable, with Benton County at 90.4 percent of the national average and Elkhart at 93.9, according to the Council for Community and Economic Research. The median household income in Benton County is $53,129 while it's $49,395 in Elkhart, according to the latest Census data. Both counties are more than 90 percent white and both tend to vote Republican, with neither having favored a Democrat for president since both did in Lyndon Johnson’s 1964 landslide.

But there's no comparison at all between what each got from the federal government as it sought to revive an economy that had been bushwhacked by the mortgage crisis, credit crunch and Wall Street meltdown. According to data from the federal government’s stimulus-tracking Web site, Recovery.gov, recipients of stimulus funds in Elkhart County reported getting about $49 million worth of contracts, grants and loans as of Oct. 1. In Benton County, the figure was a cool $1.99 billion, the vast majority of it related to work at Hanford.

If the difference in those numbers doesn’t hit you over the head, consider this: $49 million is enough to provide all of Elkhart County’s government services for about six months; $1.99 billion would pay for more than 20 years.

The consensus in Elkhart County — bereft of any large federal facilities or construction jobs — is that, at worst, the stimulus money is doing little to prime their northern Indiana economy or, at best, it may help but it's too early to tell.

There's no doubt, however, about what it is doing in southern Washington.

‘It has worked ... like it was supposed to’

Mike Stuckey
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msnbc.com

Carl Adrian

“You hear a lot about what the stimulus did or didn’t do around the country,” said Carl Adrian, president of TRIDEC, a nonprofit that works to attract new business and foster economic growth in the Benton County region. “I really do believe this is one of those communities where it has worked exactly like it was supposed to.”

Stimulus funds hit Benton County last April, within weeks of Congress approving the Recovery Act. That was partly because the enormous no-bid deals were extensions of existing Hanford contracts.

Since then, 5,651 people have been paid at least in part by Recovery Act dollars, according to the three prime contractors that are managing the project. That boils down to 2,513 FTEs, or "full-time equivalent" jobs, so far, according to the contractors. And the spending has just begun. As of Tuesday, not even 12 percent of the total $1.96 billion in Hanford stimulus funds had been paid out. The Department of Energy estimates that total FTE creation over the next two years at Hanford will surpass 4,500.

"These are fairly decently paid jobs," said Gary Petersen, TRIDEC's Hanford specialist. The work at the nuclear site involves everything from sealing up old reactors and destroying buildings, to “vitrifying” millions of gallons of radioactive and chemical waste by immobilizing it in glass containers. Much of it is carried out by workers in sophisticated hazard suits with hoods, gloves and respirators.

While the Benton County's diverse agricultural economy, which produces everything from wine to milk, accounts for the most jobs in sheer numbers, Hanford's 13,000-plus workers, less than 15 percent of the workforce, account for about 30 percent of personal income.

Unemployment in retreatThe new jobs are having much more than a trickle-down effect on the local economy. The area's unemployment rate, which had doubled from 4.4 percent in September of 2008 to 8.8 percent in January fell sharply back to 6 percent by September, according to the state's Labor Department, far below the current national rate of 10.2 percent.

"When the dollars came, the spigot turned on," Adrian said.

The deluge quickly spread to places like the county's retail showcase, the 800,000-square-foot Columbia Center Mall in Kennewick, where manager Barbara Johnson said last week, “It was Christmaslike yesterday. ... We are full for the season and I'm still getting phone calls from people looking for space."

The 1,500-student Richland campus of Washington State University, which has had double-digit growth the past two years, is “bursting at the seams,” Chancellor Vicky Carwein said.

Kadlec Medical Center, also in Richland, has added more than 300 new employees this year alone to its staff of about 1,900, said Rand Wortman, president and CEO of the 188-bed hospital.

Mike Stuckey
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msnbc.com

Manager Dan Stephens says the number of people living at the Horn Rapids RV Resort has doubled in the last year.

And on a windswept bluff overlooking the Hanford site, Horn Rapids RV Resort manager Dan Stephens has nearly twice as many long-term tenants as he had at this time last year. Ninety percent of the 145 long-term residents work at Hanford. That is a reflection of an extremely tight rental market as well as the itinerant nature of some of the job-following Hanford workers, many of whom are living out of motor homes and trailers built by Elkhart County RV industry stalwarts like Jayco, Thor and Keystone.

A different storyIt's a different story in Elkhart County. Business and community leaders don't want to seem ungrateful for the federal money that has been sent to the area, but many are quick to say that it has made little difference in the county's jobless rate, which, while off its 18.9 percent high in March, remains at 15 percent.

"Was it great to have the (Elkhart Municipal Airport) runway resurfaced? Absolutely! Was it great to have Cassopolis Street — our main entry point to the city — repaved? Yes!" said Philip Penn, president of the Greater Elkhart Chamber of Commerce, ticking off two of the biggest stimulus-funded projects in the county thus far. "But it's not going to create new jobs."

Carissa Ray
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msnbc.com

Stimulus money hasn't had a visible impact in downtown Elkhart, Ind., where the former "Dollars 'n Cents" on Main St. is one of many empty storefronts.

Elkhart attorney and businessman Jack Cittadine, who is steering the city's renovation of the Elco Theatre, put it more bluntly. “I’ve been disappointed, I have to say, and I voted for Obama," he said. "I haven’t seen the leadership I thought he would give, the fixes in many cases have been ceremonial, more PR than substance. We just haven’t seen it on the ground here to the degree that we need it.

“We make things. That’s what Elkhart County does. In terms of permanent manufacturing jobs, I haven’t seen any. The unemployment rate doesn’t show it, and anecdotally the word on the street doesn’t support it.”

Taylor, the county transportation manager, took a trip to Washington, D.C., where he testified before the House Transportation Committee about "the excitement spurred in the community by the prospect of jobs" to be created by stimulus-funded infrastructure work. That soon turned to dismay, he said, when the county found it would get relatively little money because of red tape in the application process and allocations based on a first-come, first-served system, not economic need as promised by the president. Elkhart County does expect to get bids let soon on $2.5 million it received for a repaving job.

"We hear help is on the way," Taylor told msnbc.com. "We're still waiting."

How many jobs saved or created?Elkhart Mayor Dick Moore is perhaps the strongest voice of optimism about what stimulus funds have done for his city and the county.

"I think it works," he said, pointing out the decline in the local unemployment rate while acknowledging that "I can't argue the point that the national unemployment rate is getting worse." Based strictly on mathematical formulas applied to stimulus money he says will flow to Elkhart County, Moore believes thousands of jobs have been "created or retained" locally.

But Elkhart County job-creation figures reported by recipients of Recovery Act money reveal a far more pessimistic picture. According to the federal Web site, the $49 million in Elkhart County Recovery Act funds have so far generated just 41.91 jobs — 24 from the $4 million runway repaving job at the airport and the rest attributable to smaller grants and contracts throughout the county.

Forty-two jobs for $49 million? The federal government's formulas say that money should have directly saved or created 300 to 500 positions, not a watershed in a county that has lost jobs by the thousands in the past year, but significant. Msnbc.com's calculations, based on studying stimulus-funded contracts and interviews with numerous public officials in Elkhart County, indicate the true job-creation figure is probably more than double the figure reported on Recovery.gov, although nothing close to 500.

The confusion lies partly in disputes and misunderstandings about how to calculate the number and partly in inconsistent reporting of data. For instance, $34 million listed on Recovery.gov went to Elkhart County school districts. But much of that simply replaced funds that the state owed the districts anyway. District business managers balked at reporting that the money saved or created any jobs, even though they were instructed to do so by state officials. And all jobs supposedly saved or created in schools were rolled up in statewide figures and cannot be found by ZIP Code in Elkhart County, as can other local job counts.

The county's top job producer?Some of the school money, like a $5.3 million grant to the countywide special education cooperative run by the Goshen school district, did create new positions, more than 35, making it the apparent top job-producing stimulus program in the county.

“We created about 32 paraprofessional positions, pretty low income, $10,000 to $11,000 a year," said Dr. Mary Beth Hamilton, director of the program. Two psychologists, a social worker and a part-time speech pathologist also were hired, she said. All of the positions were filled on two-year contracts because the grant money will be gone after that, she said.

More jobs may also be saved or created by about $20 million in state highway work scheduled for Elkhart County that is not listed by Elkhart County ZIP codes on Recovery.gov. Also not included is a $39 million grant to truck and bus maker Navistar, which President Obama promised was to build electric delivery vehicles and create jobs in the county. The company has not announced when that will happen.

So why has the local unemployment rate gone down? That’s "entirely due to the RV industry going out to their dealers and offering them deals" to build inventories, said Elkhart County Commissioner Mike Yoder. "If you can say that stimulus dollars began somehow pulling this country out of recession then, yes, some of that trickled down to the RV workers."

As far as whether or not Elkhart got a fair share of the stimulus money compared to places like Benton County, leaders in both communities are loathe to make those comparisons.

‘You have to be very appreciative’
"I can't judge it," said Moore. "You have to be very appreciative. I think we've been recognized very well."

In the case of Benton County and the Hanford site, "We were fortunate because the work was basically under contract to some extent," said Adrian. "If you’re in Elkhart and you don’t have a bridge ready to be rebuilt, it’s a little different.”

But Yoder said Elkhart County got something this year that few places its size get in the span of six months — two presidential visits, preceded by two Obama visits last year before the election. "That will have the longest term effect on this economy," Yoder said. "That really put us on the map."

Robert Hood
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msnbc.com file

Elkhart County Commissioner Mike Yoder says the region's new name recognition will ultimately have the biggest economic impact.

As a result, said Yoder, many firms looking to start or expand their businesses became aware of Elkhart County's proximity to the East Coast and Southeast, transportation infrastructure, “a lot of workers that are trained for manufacturing type stuff” and generally non-union climate.

Dorinda Heiden-Guss, president of the Economic Development Corporation of Elkhart County, confirmed that her group has seen “a flurry of activity” in terms of announcements and proposals but wonders “what is that resulting to the bottom line?” She said a common misconception that she and Chamber officials are encountering from outsiders is that the Recovery Act provided easy money to fund startups and relocations.

Meanwhile, Benton County leaders, who have seen busts associated with Hanford just as they're seeing a boom currently, know that continued good times will depend on diversifying their economy, as Elkhart is struggling to do now.

“We don’t want to sound like everything here is roses," said Benton County's Petersen. "We’re aware that the stimulus dollars are going to run out and we have to look to the future," which currently includes trying to build on research activity associated with the DOE lab, some niche manufacturing and biofuels development.